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Chancellor Angela Merkel admitted on Monday that Germany and Europe's policy towards the large numbers of refugees arriving in 2015 has been "anything but perfect" – but insisted that the country could rise to the challenge.

"We are working on it. It's anything but perfect" at the moment, Merkel told a 60-strong audience at a town hall meeting in Nuremberg, Bavaria's second city.

There are indeed "many, many asylum applicants," Merkel added, "but we are [a nation of] 80 million. We can and will manage this integration."

Merkel also made sure to address the concerns that critics to her right have raised – many of them in her own party.

"A pensioner must not get the impression that one just has to come from outside [Germany] and then can get a better deal. We have to manage this, otherwise there'll be bad blood," the Chancellor said.

She added that it was a top priority to deport those whose asylum applications are rejected by the authorities, including around 100,000 people from the Balkan states who have arrived in Germany this year.